Limits of the narrative exposed in crypto-related stocks…fundamentals and execution decided success

In 2025, crypto-related stocks surged early in the year on the back of Bitcoin strength, but as volatility increased and investment criteria changed over the year, performance differences became pronounced toward year-end. The market rapidly shifted toward valuing fundamentals and execution over simple crypto exposure.

On the 24th (local time), Decrypt reported that earlier this year, as Bitcoin surpassed $100,000, stocks of companies holding crypto as financial assets or engaged in mining and related businesses rose together. Miner stocks such as Hut 8 and Riot Platforms recorded double-digit gains, and funds flowed into companies that put crypto financial strategies at the forefront.

The early-year rally coincided with Bitcoin recovering its all-time high after a late-2024 correction and rising to around $109,000 on January 20. As a result, companies with high holdings of Bitcoin and altcoins received a market premium.

However, the mood changed quickly after the first half. The market began to distinguish between narrative-driven names and companies backed by substantive business structures, and funding methods, equity dilution risk, and underlying asset value emerged as key evaluation criteria.

Looking at annual performance, Bitmain Emerging Technologies rose 318%, recording the highest return. Hut 8 rose 83%, Galaxy Digital 26%, and Riot Platforms 24%. However, these names also saw their gains shrink significantly after surging in the first half, increasing volatility.

In particular, some names gave back a substantial portion of their first-half gains. Companies that surged after announcing crypto financial strategies in the first half entered a phase of scrutiny over results and capital structure in the second half. Stock prices that had been maintained by expectations faced downward pressure.

In the second half, Bitcoin fell about 30% from its October peak, shifting market sentiment more conservatively. Investors re-evaluated crypto-related stocks by focusing on profitability, net asset value (NAV), and the soundness of capital management rather than growth.

The market cites fundamentals and execution as the key factors that will determine the performance of crypto-related stocks in 2026. While the direction of Bitcoin and Ethereum prices will continue to have an impact, predictable revenue structures and business execution ability, rather than simple exposure, are expected to determine stock prices.